American Tower Corporation Reports Fourth Quarter And Full Year 2012 Financial Results

American Tower Corporation (NYSE: AMT) today reported financial results for the fourth quarter and full year ended December 31, 2012.

Jim Taiclet, American Tower’s Chief Executive Officer stated, “2012 represented another strong year of performance, as we remained focused on two primary aspirations: strengthening our core U.S. business by securing extended customer agreements to enable robust, sustained organic growth; and leveraging the rapid global adoption of wireless services to drive our international market expansion. As a result, we were able to achieve Core Growth in rental revenue and Adjusted EBITDA of over 21% and Core Growth in AFFO of nearly 19%.

"Our Outlook for 2013 reflects continued mid-teen Core Growth in rental revenue, Adjusted EBITDA and AFFO, and we are focused on pursuing our disciplined global investment strategy to sustain these levels of growth into the future."

FOURTH QUARTER 2012 OPERATING RESULTS OVERVIEW

American Tower generated the following operating results for the quarter ended December 31, 2012 (unless otherwise indicated, all comparative information is presented against the quarter ended December 31, 2011).

Total revenue increased 17.6% to $768.4 million and total rental and management revenue increased 15.4% to $739.7 million. Total rental and management revenue Core Growth was approximately 19.3%. Please refer to the selected statement of operations detail on page 14, which highlights the items affecting all Core Growth percentages for the quarter ended December 31, 2012.

Total rental and management Gross Margin increased 15.6% to $562.9 million, which includes the impact of a one-time favorable expense item attributable to the domestic rental and management segment, as further described below. Total selling, general, administrative and development expense was $89.4 million, including $11.9 million of stock-based compensation expense. Adjusted EBITDA increased 16.8% to $500.6 million, Core Growth in Adjusted EBITDA was 19.6%, and Adjusted EBITDA Margin was 65%.

Adjusted Funds From Operations (AFFO) increased 4.7% to $289.7 million, which includes the negative impact of two non-recurring international tax payments of approximately $15.5 million in aggregate and new market start-up capital expenditures of approximately $5.6 million. Core Growth in AFFO was approximately 11.6%, and AFFO per Share increased 2.9% to $0.72.

Operating income increased 12.7% to $279.2 million, while net income attributable to American Tower Corporation decreased 33.9% to $135.7 million. The decrease was primarily attributable to a one-time positive net impact of approximately $121.0 million during the fourth quarter of 2011, as a result of the reversal of certain deferred tax assets and liabilities resulting from the Company’s conversion to a real estate investment trust (REIT). In addition, contributing to the decrease was the negative impact of approximately $39.4 million that the Company recorded during the fourth quarter of 2012 in relation to valuation allowances attributable to net operating losses generated by its international rental and management segment. Net income attributable to American Tower Corporation per both basic and diluted common share decreased 34.6% to $0.34.

International Rental and Management Segment – International rental and management segment revenue increased 36.3% to $239.8 million, which represented 31% of total revenues. International rental and management segment Gross Margin increased 29.7% to $147.4 million, while international rental and management segment Operating Profit increased 30.5% to $120.2 million. International rental and management segment Operating Profit Margin was 50% (70%, excluding the impact of $67.9 million of pass-through revenues).

American Tower generated the following operating results for the full year ended December 31, 2012 (unless otherwise indicated, all comparative information is presented against the full year ended December 31, 2011).

Total revenue increased 17.7% to $2,876.0 million and total rental and management revenue increased 17.5% to $2,803.5 million. Total rental and management revenue Core Growth was approximately 21.1%. Please refer to the selected statement of operations detail on page 14, which highlights the items affecting all Core Growth percentages for the year ended December 31, 2012.

Total rental and management Gross Margin increased 17.7% to $2,131.9 million. Total selling, general, administrative and development expense was $327.3 million, including $50.2 million of stock-based compensation expense. Adjusted EBITDA increased 18.6% to $1,892.4 million, Core Growth in Adjusted EBITDA was 21.3%, and the Adjusted EBITDA Margin was 66%.

AFFO increased 13.5% to $1,198.1 million, Core Growth in AFFO was approximately 18.8%, and AFFO per Share increased 13.6% to $3.00.

Operating income increased 21.7% to $1,119.7 million, while net income attributable to American Tower Corporation increased 60.7% to $637.3 million. Net income attributable to American Tower Corporation per basic common share increased 61.0% to $1.61, and net income attributable to American Tower Corporation per diluted common share increased 61.6% to $1.60.

International Rental and Management Segment – International rental and management segment revenue increased 34.4% to $862.8 million, which represented 30% of total revenues. International rental and management segment Gross Margin increased 30.5% to $548.7 million, while international rental and management segment Operating Profit increased 33.9% to $453.1 million. International rental and management segment Operating Profit Margin was 53% (72%, excluding the impact of $229.1 million of pass-through revenues).

Distributions – On December 31, 2012, the Company paid its fourth quarter distribution of $0.24 per share, or a total of approximately $94.8 million, to stockholders of record at the close of business on December 17, 2012.

During the twelve months ended December 31, 2012, the Company paid an aggregate of $0.90 per share in distributions, or a total of approximately $355.6 million, to its stockholders. Subject to the discretion of the Company’s Board of Directors, the Company expects to continue paying regular distributions, the amount and timing of which will be determined by the Board.

Cash Paid for Capital Expenditures – During the fourth quarter of 2012, total capital expenditures of $191.0 million included $86.9 million for discretionary capital projects, including spending to complete the construction of 87 towers and the installation of 6 distributed antenna system networks and 304 shared generators domestically and the construction of 432 towers and the installation of 2 distributed antenna system networks internationally; $33.9 million to purchase land under the Company’s communications sites; $28.0 million for the redevelopment of existing communications sites to accommodate new tenant equipment; and $42.3 million for capital improvements and corporate capital expenditures.

During the twelve months ended December 31, 2012, total capital expenditures of $568.0 million included $279.0 million for discretionary capital projects, including spending to complete the construction of 235 towers and the installation of 15 distributed antenna system networks and 603 shared generators domestically and the construction of 2,109 towers and the installation of 2 distributed antenna system networks internationally; $82.3 million to purchase land under the Company’s communications sites; $86.7 million for the redevelopment of existing communications sites to accommodate new tenant equipment; and $120.0 million for capital improvements and corporate capital expenditures.

Cash Paid for Acquisitions – During the fourth quarter of 2012, the Company spent $1,175.2 million for the purchase of 627 domestic towers, 24 domestic property interests under third-party communications sites and 2,263 international towers. The international towers consisted of those acquired pursuant to previously announced agreements, including 2,031 towers in Germany, 190 towers in Mexico and 42 towers in Colombia. Subsequent to the end of the fourth quarter of 2012, the Company acquired an additional 883 towers in Mexico for an aggregate purchase price of $248.5 million, subject to post-closing adjustments and value added tax.

During the twelve months ended December 31, 2012, the Company spent $1,998.0 million for the purchase of 713 domestic towers, 24 domestic property interests under third-party communications sites, 5,733 international towers and amounts due for acquisitions completed in December of 2011.

Stock Repurchase Program – During the fourth quarter of 2012, the Company repurchased a total of approximately 0.6 million shares of its common stock for approximately $46.0 million pursuant to its stock repurchase program. Between January 1, 2013 and January 21, 2013, the Company repurchased an additional 15,790 shares of its common stock for an aggregate of $1.2 million.

During the twelve months ended December 31, 2012, the Company repurchased a total of approximately 0.9 million shares of its common stock for approximately $62.7 million pursuant to its stock repurchase program.

Liquidity – As of December 31, 2012, the Company had approximately $1.1 billion of total liquidity, comprised of approximately $368.6 million in cash and cash equivalents, plus the ability to borrow an aggregate of approximately $734.6 million under its two revolving credit facilities, net of any outstanding letters of credit.

Subsequent to the end of the fourth quarter of 2012, the Company increased its liquidity by approximately $1.0 billion through the issuance of 3.50% senior unsecured notes due 2023, the net proceeds of which were used to repay borrowings under the Company’s revolving credit facilities.

FULL YEAR 2013 OUTLOOK

The following estimates are based on a number of assumptions that management believes to be reasonable and reflect the Company’s expectations as of February 26, 2013. These estimates include the impact of the Company’s acquisition of 883 towers in Mexico, which closed subsequent to the end of the fourth quarter of 2012 and the construction of between 2,250 to 2,750 new sites. Actual results may differ materially from these estimates as a result of various factors, and the Company refers you to the cautionary language regarding “forward-looking” statements included in this press release when considering this information.

The Company’s outlook for total rental and management revenue reflects the following at the midpoint: (1) domestic rental and management segment revenue of $2,080 million; and (2) international rental and management segment revenue of $1,105 million, which includes approximately $285 million of pass-through revenue.

The calculation of midpoint Core Growth is as follows:

(Totals may not add due to rounding.)

Total Rental andManagementRevenue

AdjustedEBITDA

AFFO

Outlook midpoint Core Growth

16.5%

14.8%

16.3%

Estimated impact of fluctuations in foreign currency exchange rates

(0.2)%

(0.0)%

0.0%

Impact of straight-line revenue and expense recognition

(2.0)%

(2.4)%

-

Impact of significant one-time items(1)

(0.6)%

(1.1)%

(0.8)%

Outlook midpoint growth

13.6%

11.2%

15.6%

___

(1) Attributable to 2012 one-time items and new market start-up capital expenditures of approximately $20 million in 2013.

Outlook for Capital Expenditures:

($ in millions)

(Totals may not add due to rounding.)

Full Year 2013

Discretionary capital projects (1)

$240

to

$300

Ground lease purchases

85

to

105

Redevelopment

95

to

105

Capital improvement (2)

105

to

115

Corporate

25

-

25

Total

$550

to

$650

___

(1) Includes the construction of approximately 2,250 to 2,750 new communications sites.

(2) Includes new market start-up capital expenditures of approximately $20 million and spending related to a lighting system upgrade in the U.S of approximately $15 million.

Reconciliations of Outlook for Net Income to Adjusted EBITDA:

($ in millions)

(Totals may not add due to rounding.)

Full Year 2013

Net income

$765

to

$840

Interest expense

460

to

450

Depreciation, amortization and accretion

755

to

725

Income tax provision

63

to

73

Stock-based compensation expense

65

-

65

Other, including other operating expenses, interest income, loss on retirement of long-term obligations, (income) loss on equity method investments and other (income) expense

(28)

to

(23)

Adjusted EBITDA

$2,080

to

$2,130

Reconciliations of Outlook for Net Income to Adjusted Funds From Operations:

American Tower will host a conference call today at 8:30 a.m. ET to discuss its financial results for the fourth quarter and full year ended December 31, 2012 and its outlook for 2013. Supplemental materials for the call will be available on the Company’s website, www.americantower.com. The conference call dial-in numbers are as follows:

U.S./Canada dial-in: (866) 740-9153

International dial-in: (706) 645-9644

Passcode: 94770658

When available, a replay of the call can be accessed until 11:59 p.m. ET on March 12, 2013. The replay dial-in numbers are as follows:

U.S./Canada dial-in: (855) 859-2056

International dial-in: (404) 537-3406

Passcode: 94770658

American Tower will also sponsor a live simulcast and replay of the call on its website, www.americantower.com.

About American Tower

American Tower is a leading independent owner, operator and developer of wireless and broadcast communications real estate. American Tower currently owns and operates over 54,000 communications sites in the United States, Brazil, Chile, Colombia, Germany, Ghana, India, Mexico, Peru, South Africa and Uganda. For more information about American Tower, please visit www.americantower.com.

Non-GAAP and Defined Financial Measures

In addition to the results prepared in accordance with generally accepted accounting principles in the United States (GAAP) provided throughout this press release, the Company has presented the following non-GAAP and defined financial measures: Gross Margin, Operating Profit, Operating Profit Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Funds From Operations, Adjusted Funds From Operations, Adjusted Funds From Operations per Share, Core Growth and Net Leverage Ratio.

The Company defines Gross Margin as revenues less operating expenses, excluding stock-based compensation expense. The Company defines Operating Profit as Gross Margin less selling, general, administrative and development expense, excluding stock-based compensation expense and corporate expenses. For reporting purposes, the international rental and management segment Operating Profit and Gross Margin also include interest income, TV Azteca, net. These measures of Gross Margin and Operating Profit are also before interest income, interest expense, loss on retirement of long-term obligations, other income (expense), net income attributable to non-controlling interest, income (loss) on equity method investments, income taxes and discontinued operations. The Company defines Operating Profit Margin as the percentage that results from dividing Operating Profit by revenue. The Company defines Adjusted EBITDA as net income before income (loss) from discontinued operations, net, income (loss) from equity method investments, income tax provision (benefit), other (income) expense, loss on retirement of long-term obligations, interest expense, interest income, other operating expenses, depreciation, amortization and accretion and stock-based compensation expense. The Company defines Adjusted EBITDA Margin as the percentage that results from dividing Adjusted EBITDA by total revenue. The Company defines Funds From Operations as net income before real estate related depreciation, amortization and accretion. The Company defines Adjusted Funds From Operations as Funds From Operations before straight-line revenue and expense, stock-based compensation expense, non-cash portion of tax provision, non-real estate related depreciation, amortization and accretion, amortization of deferred financing costs, debt discounts and capitalized interest, other (income) expense, loss on retirement of long-term obligations, other operating (income) expense, less cash payments related to capital improvements and cash payments related to corporate capital expenditures. The Company defines Adjusted Funds From Operations per Share as Adjusted Funds From Operations divided by the diluted weighted average common shares outstanding. Funds From Operations for the three and twelve months ended December 31, 2011 are presented on a pro forma basis and reflect adjustments for income tax provision as if the REIT conversion had occurred on January 1, 2011. The Company defines Core Growth in total rental and management revenue, Adjusted EBITDA and Adjusted Funds From Operations as the increase or decrease, expressed as a percentage, resulting from a comparison of financial results for a current period with corresponding financial results for the corresponding period in a prior year, in each case, excluding the impact of straight-line revenue and expense recognition, foreign currency exchange rate fluctuations and significant one-time items. The Company defines Net Leverage Ratio as net debt (total debt, less cash and cash equivalents) divided by last quarter annualized Adjusted EBITDA. These measures are not intended to replace financial performance measures determined in accordance with GAAP. Rather, they are presented as additional information because management believes they are useful indicators of the current financial performance of the Company’s core businesses. The Company believes that these measures can assist in comparing company performances on a consistent basis irrespective of depreciation and amortization or capital structure. Depreciation and amortization can vary significantly among companies depending on accounting methods, particularly where acquisitions or non-operating factors, including historical cost bases, are involved. Notwithstanding the foregoing, the Company’s measures of Gross Margin, Operating Profit, Operating Profit Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Funds From Operations, Adjusted Funds From Operations, Adjusted Funds From Operations per Share, Core Growth and Net Leverage Ratio may not be comparable to similarly titled measures used by other companies.

Cautionary Language Regarding Forward-Looking Statements

This press release contains "forward-looking statements" concerning our goals, beliefs, expectations, strategies, objectives, plans, future operating results and underlying assumptions, and other statements that are not necessarily based on historical facts. Examples of these statements include, but are not limited to statements regarding our full year 2013 outlook, foreign currency exchange rates and our expectation regarding the declaration of regular distributions. Actual results may differ materially from those indicated in our forward-looking statements as a result of various important factors, including: (1) decrease in demand for our communications sites would materially and adversely affect our operating results and we cannot control that demand; (2) new technologies or changes in a tenant’s business model could make our tower leasing business less desirable and result in decreasing revenues; (3) our business is subject to government regulations and changes in current or future laws or regulations could restrict our ability to operate our business as we currently do; (4) if our tenants consolidate, merge or share site infrastructure with each other to a significant degree, our growth, revenue and ability to generate positive cash flows could be materially and adversely affected; (5) we could suffer adverse tax or other financial consequences if taxing authorities do not agree with our tax positions; (6) a substantial portion of our revenue is derived from a small number of tenants, and we are sensitive to changes in the creditworthiness and financial strength of our tenants; (7) our foreign operations are subject to economic, political and other risks that could materially and adversely affect our revenues or financial position, including risks associated with fluctuations in foreign currency exchange rates; (8) our expansion initiatives involve a number of risks and uncertainties that could adversely affect our operating results, disrupt our operations or expose us to additional risk if we are not able to successfully integrate operations, assets and personnel; (9) if we are unable to protect our rights to the land under our towers, it could adversely affect our business and operating results; (10) increasing competition in the tower industry may create pricing pressures that may materially and adversely affect us; (11) if we are unable or choose not to exercise our rights to purchase towers that are subject to lease and sublease agreements at the end of the applicable period, our cash flows derived from such towers would be eliminated; (12) if we fail to qualify as a REIT or fail to remain qualified as a REIT, we would be subject to tax at corporate income tax rates, which would substantially reduce funds otherwise available; (13) we may be limited in our ability to fund required distributions using cash generated through our TRSs; (14) complying with REIT requirements may limit our flexibility or cause us to forego otherwise attractive opportunities; (15) certain of our business activities may be subject to corporate level income tax and foreign taxes, which reduce our cash flows, and may have deferred and contingent tax liabilities; (16) we may need additional financing to fund capital expenditures, future growth and expansion initiatives and to satisfy our REIT distribution requirements;(17) our leverage and debt service obligations may materially and adversely affect us; (18) restrictive covenants in the loan agreements related to our securitization transaction, the loan agreements for our credit facilities and the indentures governing our debt securities could materially and adversely affect our business by limiting flexibility; (19) we may incur goodwill and other intangible asset impairment charges which could result in a significant reduction to our earnings; (20) we have limited experience operating as a REIT, which may adversely affect our financial condition, results of operations, cash flow and ability to satisfy debt service obligations; (21) we could have liability under environmental and occupational safety and health laws; (22) our towers or data centers may be affected by natural disasters and other unforeseen events for which our insurance may not provide adequate coverage; and (23) our costs could increase and our revenues could decrease due to perceived health risks from radio emissions, especially if these perceived risks are substantiated. For additional information regarding factors that may cause actual results to differ materially from those indicated in our forward-looking statements, we refer you to the information contained in Item 1A of our Form 10-Q for the nine months ended September 30, 2012. We undertake no obligation to update the information contained in this press release to reflect subsequently occurring events or circumstances.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

December 31,

December 31,

2012

2011(1)

ASSETS:

Current assets:

Cash and cash equivalents

$368,618

$330,191

Restricted cash

69,316

42,215

Short-term investments and available-for-sale securities

6,018

22,270

Accounts receivable, net

136,971

100,610

Prepaid and other current assets

222,851

250,273

Deferred income taxes

25,754

29,596

Total current assets

829,528

775,155

Property and equipment, net

5,789,995

4,981,722

Goodwill

2,912,046

2,676,290

Other intangible assets, net

3,115,053

2,495,053

Deferred income taxes

213,518

209,031

Deferred rent asset

776,201

609,529

Notes receivable and other non-current assets

452,788

495,615

Total

$14,089,129

$12,242,395

LIABILITIES AND EQUITY:

Current liabilities:

Accounts payable

$89,578

$215,931

Accrued expenses

286,962

305,538

Distributions payable

189

-

Accrued interest

71,271

65,729

Current portion of long-term obligations

60,031

101,816

Unearned revenue

124,147

92,483

Total current liabilities

632,178

781,497

Long-term obligations

8,693,345

7,134,492

Asset retirement obligations

435,724

344,180

Other non-current liabilities

643,701

572,084

Total liabilities

10,404,948

8,832,253

COMMITMENTS AND CONTINGENCIES

EQUITY :

Common stock

3,959

3,936

Additional paid-in capital

5,012,124

4,903,800

Distributions in excess of earnings

(1,196,907)

(1,477,899)

Accumulated other comprehensive loss

(183,347)

(142,617)

Treasury stock(2)

(62,728)

-

Total American Tower Corporation equity

3,573,101

3,287,220

Noncontrolling interest

111,080

122,922

Total equity

3,684,181

3,410,142

Total

$14,089,129

$12,242,395

(1) December 31, 2011 balances have been revised to reflect purchase accounting measurement period adjustments.

(2) As part of the Company’s reorganization to qualify as a REIT for federal income tax purposes, effective December 31, 2011, the Company completed the merger with its predecessor, approved by the Company’s stockholders in November 2011. At the time of the merger, each share of Class A common stock of American Tower held in treasury at December 31, 2011 ceased to be outstanding, and a corresponding adjustment was recorded to additional paid‐in capital and common stock.

(In thousands, except where noted. Totals may not add due to rounding.)

Selected Balance Sheet Detail:

December 31, 2012

Long-term obligations summary, including current portion

December 31, 2012

Pro Forma (1)

2011 Credit Facility

$265,000

$-

2012 Credit Facility

992,000

322,000

2012 Term Loan

750,000

750,000

4.625% Senior Notes due 2015

599,638

599,638

7.000% Senior Notes due 2017

500,000

500,000

4.500% Senior Notes due 2018

999,414

999,414

7.250% Senior Notes due 2019

296,272

296,272

5.050% Senior Notes due 2020

699,333

699,333

5.900% Senior Notes due 2021

499,356

499,356

4.700% Senior Notes due 2022

698,760

698,760

3.500% Senior Notes due 2023

-

991,850

Total Unsecured at American Tower Corporation

$6,299,773

$6,356,624

Commercial Mortgage Pass-Through Certificates, Series 2007-1

1,750,000

1,750,000

Unison Notes (2)

207,188

207,188

South African Facility (3)

98,456

98,456

Colombian long-term credit facility (3)

76,347

76,347

Colombian bridge loans (3)

53,169

53,169

Shareholder loans (4)

211,150

211,150

Capital leases

57,293

57,293

Total Secured or Subsidiary Debt

$2,453,603

$2,453,603

Total debt

$8,753,376

$8,810,227

Cash and cash equivalents

368,618

Net debt (total debt less cash and cash equivalents)

$8,384,758

(1)

Pro Forma as of February 26, 2013 for: (a) the registered public offering of $1.0 billion aggregate principal amount of senior unsecured notes and associated repayment of certain indebtedness under the 2011 and 2012 Credit Facilities; and (b) the aggregate borrowing of an additional $49 million under the 2012 Credit Facility.

(2)

The Unison Notes are secured debt and were assumed as a result of the acquisition of certain legal entities holding a portfolio of property interests from Unison Holdings LLC and Unison Site Management II, L.L.C.

(3)

Denominated in local currency.

(4)

Denominated in USD, reflects balances attributable to minority shareholder loans in the Company’s joint ventures in Colombia, Ghana and Uganda.

Three Months Ended

Calculation of Net Leverage Ratio ($ in thousands)

December 31, 2012

Total debt

$8,753,376

Cash and cash equivalents

368,618

Numerator: net debt (total debt less cash and cash equivalents)

$8,384,758

Adjusted EBITDA

$500,630

Denominator: annualized Adjusted EBITDA

2,002,520

Net leverage ratio

4.2x

UNAUDITED SELECTED FINANCIAL INFORMATION

(In thousands, except where noted. Totals may not add due to rounding.)

Three Months Ended

Twelve Months Ended

Share count rollforward: (in millions of shares)

December 31,2012

December 31,2012

Total common shares, beginning of period

395.4

393.6

Common shares repurchased

(0.6)

(0.9)

Common shares issued

0.3

2.3

Total common shares outstanding, end of period (1)

395.1

395.1

(1)

As of December 31, 2012, excludes (a) 3.2 million potentially dilutive shares associated with vested and exercisable stock options with an average exercise price of $37.07 per share, (b) 2.7 million potentially dilutive shares associated with unvested stock options, and (c) 1.9 million potentially dilutive shares associated with unvested restricted stock units.

Total rental and management straight-line revenue and expense:

In accordance with GAAP, the Company recognizes consolidated rental and management revenue and expense related to non-cancellable customer and ground lease agreements with fixed escalations on a straight-line basis, over the applicable lease term. As a result, the Company’s revenue recognized may differ materially from the amount of cash collected per tenant lease, and the Company’s expense incurred may differ materially from the amount of cash paid per ground lease. Additional information regarding straight-line accounting can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 in the section entitled "Revenue Recognition," in note 1, "Business and Summary of Significant Accounting Policies" within the notes to the consolidated financial statements. A summary of total rental and management straight-line revenue and expense, which represents the non-cash revenue and expense recorded due to straight-line recognition, is as follows:

Three Months Ended

Twelve Months Ended

December 31,

December 31,

2012

2011

2012

2011

Total rental and management operations straight-line revenue

$47,260

$50,994

$165,806

$143,994

Total rental and management operations straight-line expense

$7,553

$7,827

$33,700

$30,952

Three Months Ended

Twelve Months Ended

December 31,

December 31,

Selling, general, administrative and development expense breakout:

2012

2011

2012

2011

Total rental and management overhead

$52,171

$42,000

$181,242

$159,147

Network development services segment overhead

2,334

2,734

6,744

7,864

Corporate and development expenses

22,994

18,475

89,093

76,705

Stock-based compensation expense

11,911

10,686

50,222

45,108

Total

$89,410

$73,895

$327,301

$288,824

Three Months Ended

Twelve Months Ended

December 31,

December 31,

International pass-through revenue detail:

2012

2011

2012

2011

Pass-through revenue

$67,933

$49,388

$229,105

$176,085

SELECTED CASH FLOW DETAIL:

Three Months Ended

Twelve Months Ended

December 31,

December 31,

Payments for purchase of property and equipment and construction activities:

2012

2011

2012

2011

Discretionary - capital projects

$86,850

$74,996

$279,015

$296,906

Discretionary - ground lease purchases

33,887

11,012

82,349

91,292

Redevelopment

27,954

18,020

86,656

55,301

Capital improvements (1)

36,477

16,714

99,981

60,829

Corporate

5,853

5,184

20,047

18,687

Total

$191,021

$125,926

$568,048

$523,015

____

(1)

Includes new market start-up capital expenditures of: (a) approximately $5.6 million during the three months ended December 31, 2012; and (b) approximately $24.5 million during the twelve months ended December 31, 2012.

UNAUDITED SELECTED FINANCIAL INFORMATION

(Totals may not add due to rounding.)

SELECTED STATEMENT OF OPERATIONS DETAIL:

The following table reflects the estimated impact of foreign currency exchange rate fluctuations, straight-line revenue and expense recognition and material one-time items on total rental and management revenue, Adjusted EBITDA and AFFO:

The calculation of Core Growth is as follows:

Total Rental and

ManagementRevenue

Adjusted EBITDA

AFFO

Three Months Ended December 31, 2012

Core Growth

19.3%

19.6%

11.6%

Estimated impact of fluctuations in foreign currency exchange rates

(1.8)%

(1.4)%

(1.4)%

Impact of straight-line revenue recognition

(2.0)%

(2.8)%

-

Impact of material one-time items

-

1.4%

(5.6)%

Reported growth

15.4%

16.8%

4.7%

Total Rental and ManagementRevenue

Adjusted EBITDA

AFFO

Twelve Months Ended December 31, 2012

Core Growth

21.1%

21.3%

18.8%

Estimated impact of fluctuations in foreign currency exchange rates

(3.8)%

(3.1)%

(3.8)%

Impact of straight-line revenue recognition

(0.2)%

(0.1)%

-

Impact of material one-time items

0.5%

0.6%

(1.4)%

Reported growth

17.5%

18.6%

13.5%

SELECTED PORTFOLIO DETAIL - OWNED SITES:

Tower Count(1):

As of

As of

September 30, 2012

Constructed

Acquired

Adjustments

December 31, 2012

United States(2)

21,668

87

627

152

22,534

Brazil

4,311

28

-

6

4,345

Chile

1,180

1

-

-

1,181

Colombia

2,847

58

42

57

3,004

Germany

-

-

2,031

-

2,031

Ghana

1,908

18

-

-

1,926

India

10,116

287

-

(25)

10,378

Mexico(3)

5,562

26

190

(1)

5,777

Peru

475

-

-

25

500

South Africa

1,601

2

-

1

1,604

Uganda

1,031

12

-

-

1,043

___

Total

50,699

519

2,890

215

54,323

(1)

Excludes in-building and outdoor distributed antenna system networks.

(2)

Includes 274 broadcast towers.

(3)

Includes 199 broadcast towers.

UNAUDITED RECONCILIATIONS TO GAAP MEASURES AND THE CALCULATION OF DEFINED FINANCIAL MEASURES

(In thousands, except percentages. Totals may not add due to rounding.)

The reconciliation of net income to Adjusted EBITDA and the calculation of Adjusted EBITDA Margin are as follows:

Three Months Ended

Twelve Months Ended

December 31,

December 31,

2012

2011

2012

2011

Net income

$118,153

$196,434

$594,025

$381,840

Income from equity method investments

(10)

(11)

(35)

(25)

Income tax provision (benefit)

43,187

(36,901)

107,304

125,080

Other expense

18,832

7,265

38,300

122,975

Loss on retirement of long-term obligations

-

-

398

-

Interest expense

104,043

85,119

401,665

311,854

Interest income

(1,427)

(541)

(7,680)

(7,378)

Other operating expenses

27,035

22,333

62,185

58,103

Depreciation, amortization and accretion

178,488

143,615

644,276

555,517

Stock-based compensation expense

12,329

11,252

51,983

47,437

Adjusted EBITDA

$500,630

$428,565

$1,892,421

$1,595,403

Divided by total revenue

768,374

653,199

2,875,960

2,443,532

Adjusted EBITDA Margin

65%

66%

66%

65%

UNAUDITED REIT MEASURES AND RECONCILIATIONS TO GAAP MEASURES

(In thousands, except per share data. Totals may not add due to rounding.)

The reconciliation of net income to Funds From Operations and the calculation of Adjusted Funds From Operations and Adjusted Funds From Operations per Share are presented below:

Adjustment for three and twelve months ended December 31, 2011 assumes the REIT election occurred effective as of January 1, 2011, and that as a result, income taxes would no longer be payable on certain of the Company’s activities. As a result, on a pro forma basis, income tax expense is lower by the amount of the adjustment. For more information, see Note (B) to Unaudited Pro Forma Consolidated Financial Statements in the Company’s Definitive Proxy Statement, filed with the SEC on October 11, 2011. The pro forma adjustment set forth in this footnote has been made solely for the purpose of this pro forma information. This information is not necessarily indicative of the financial position or operating results that would have been achieved had the REIT election been effective as of January 1, 2011, nor is it necessarily indicative of future financial position or operating results. It also does not reflect one-time transaction costs related to the REIT election and the potential immaterial effect of lower cash balances these transactions have on interest income, higher borrowing costs or foregone investment opportunities.

A plan reportedly crafted by Trump administration officials suggests the government would build a 5G network and lease capacity to telecoms. If accurate, the plan would have major implications for multiple industries.